It seems that we cannot go a week without hearing that, as a nation, we are living longer. It is a fact that, due to improvements in health care and standards of living, our life expectancy has increased. At the same time we also hear that, as our life expectancy has increased, so has the number of age related illnesses: chief among them dementia and those affecting mental capacity.
Besides the huge impact on the personal life of someone suffering from a degenerative mental health illness, and their families, there is also the often unexpected complication of having to do battle with banks and building societies in order to continue paying care fees and other necessary expenses on behalf of their spouse or parent. Often people may think that they are secure as they have joint accounts. This, unfortunately, is not the case. Banks have the power to freeze even joint accounts if they suspect that one of the holders has lost mental capacity.
Increasingly we see clients who wish to know how to prepare for the eventuality of a loss of mental capacity and ensure that their affairs can be managed with as little difficulty as possible for their relatives and friends who are left to look after them and their finances.
In the first place, while people still have capacity, they can create a Lasting Power of Attorney (LPA). A person making a LPA (the donor) states who they would like to manage their financial or property affairs (attorneys). These attorneys are usually a spouse and/or children, but can be anyone the donor trusts to act on their behalf.
The advantage of a LPA is that the donor has the option to choose who to act for them and how. There is the option for the donor to specify what can, or cannot be done, to ensure that all their wishes are carried out. It should always be assumed that a donor has mental capacity unless it is apparent that they do not; attorneys cannot act to stop decisions they do not like if a donor has mental capacity. With a LPA the power is very much in the hands of the person making it. Once registered a LPA can be used straight away, meaning that there is no interruption and disruption if the donor loses their capacity to act.
If a person has not made a LPA (or before 2007 an Enduring Power of Attorney), then there will be the need for someone to apply to the Court of Protection for an Order appointing someone to act as a deputy for that person’s affairs. A Deputyship Order is a considerably longer and more costly process and one which relies on the decision of the Court about who should act and how they should act. A Deputy appointed by the Court is responsible to the Court for all the dealings which they have with the person’s affairs and is subject to audits.
Given the reality of the two options our clients often decide that it is in the best interest of themselves, and their families, to make preparations by making a LPA; thus ensuring that, should the time come when they do not have capacity to make their own decisions their family does not have the added stress and financial burden of applying for an Order of the Court.
If you need advice on whether an LPA or Deputyship Order is suitable, get in touch with our team on 08700 120 130 or email email@example.com.